TMI Blog2008 (10) TMI 434X X X X Extracts X X X X X X X X Extracts X X X X ..... compensation and is not interest at all and therefore, must be taxed as compensation. - interest is not taxable on year to year basis or in the year in which the amount is actually credited to the landowner. Decision of Apex Court in Commissioner of Income Tax, Faridabad versus Ghanshyam, (HUF), ([2009 (7) TMI 12 - SUPREME COURT] - ITA No. 12 of 2008 - - - Dated:- 3-10-2008 - Mr. Justice D ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gment of the Apex Court that the interest payable under Section 28 of the Land Acquisition Act, 1894 is a part of compensation and is not interest at all and therefore, must be taxed as compensation. 3. A reference may be made to the judgment of their Lordships of the Hon ble Supreme Court in Commissioner of Income Tax, Faridabad versus Ghanshyam, (HUF), (2009)8 SCC 412, wherein the Apex Court h ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ompensation. But as discussed hereinabove, we have to go by the provisions of the 1894 Act which awards interest both as an accretion in the value of the lands acquired and interest for undue delay. Interest under Section 28 unlike interest under Section 34 is an accretion to the value, hence it is a part of enhanced compensation or consideration which is not the case with interest under Section ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he year of taxability. Consequently, even in cases where pending appeal, the court/tribunal/authority before which appeal is pending, permits the claimant to withdraw against security or otherwise the enhanced compensation (which is in dispute), the same is liable to be taxed under Section 45(5) of the 1961 Act. This is the scheme of Section 45(5) and Section 155(16) of the 1961 Act. We may clarif ..... X X X X Extracts X X X X X X X X Extracts X X X X
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